OJ,
My conclusion and then the analysis follows. I see a potential of dropping to 1331 SPOO. If so, we should SAR there and if it drops lower, say to 1327, we might want to SAR again to short for a further ride lower. I think 1331 should hold, so let's SAR early on in the day to take advantage of the rise up from here. If we hold tonight's close, we should SAR on the first retest of the low 1340's. That might be something we wish to try right out of the box, depends upon the open.
-Scott
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I tried to do this quickly tonight, yet tried to be complete in the analysis.
I started by counting out the major pivots and worked into the smaller pivot points. Based on the pivot count, this market has upside for a couple more months probably. Of course, the pivot count could fail, I have seen that in many cases, but it also leads to the best roadmap in my opinion based on the forks.
SPOOS:
Quite possibly this sell-off is over. First the bearish case however.
Basis SPOO: The lowest this sell-off should go is 1305. The probable bounce points on the way lower would be 1331/1333 and 1321/1319 and then the 1305 scenario. These numbers are only good for tomorrow. The first number is the open and the second is the closing number tomorrow.
I would not be surprised to see the 1331 scenario play out and we should know early on if that will be the case.
We are right on a middle tine here at the close. We went below the middle tine during the trading hours of one fork, but bounced off the middle tine of another fork drawn with the 50% offset.
There also are babson supports at 1330 and the next babson is at 1305. These numbers look familiar as they are the same as the forks.
If we go higher off the open, it appears to me we are heading to 1420 SPOO by the end of April, probably the end of next week.
So how is that for a range. Within one week I see us at either 1305 SPOO or 1420 SPOO. Nothing like setting up the ability to say I was right either way! :)
Anyway, the early trading will give us some good clues.
BONDS:
Look to me to be headed to 121'28 before a bounce. Resistance is at 123'08. If 121'28 would fail, then could be headed to as low as 121'07/121'03.
TYX is bouncing off resistance at 55.07 and has done so a couple times off that line. If it breaks through that TYX is heading to 55.38 and possibly worst case scenario 55.95.
Take some clues from the TYX. If it gets much above 55.07, bonds are going to 121'28 for starters. Should bounce there. That would be a good buy point, IMO. Failing 121'28 would lead to a nice SAR down to 121'03.
Later.
Scott
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